Unhappy Meal: The Problem with McDonald’s

 

I recently had the chance to hear from the Senior Director, Supply Chain Management, Quality Systems for McDonald’s. I include the whole title because I’m a sadist, and also because it perfectly captures what’s wrong with the home of the unhappy meal. Unhappy because McDonald’s sales are tanking, dropping for three years in a row, including a 2 percent drop in US sales last quarter.

There are problems in Ronald McDonald land, and a job title that arcane is a perfect example of a bureaucratic corporation that is unlikely to turn things around. If you can’t get your job title in a tweet, it’s probably going to be hard for both you and everybody else to know just exactly what it is you do.

The director is convinced that McDonald’s is struggling because they were slow to respond to shifts in consumer demand. According to him, McDonald’s was tardy in listening to the well organized social media demands for sustainable, non-GMO, antibiotic-free food, and the banishment of any other technology that offends those who long for a return to peasant farming.

Although no business can ignore a consumer groundswell, McDonald’s ain’t never gonna be one of the cool kids. Or, as I rather inartfully put it when he took questions: “Your best-selling item is an unidentifiable chicken part rolled in flour and deep fat fried. Your customers are not on the cutting edge of the food movement. The last time I went to a McDonald’s, I couldn’t get anybody to take my order and my feet stuck to the floor. Mop the floors and improve service, and you might succeed!”

He disagreed, of course, and referred to any number of books and articles that described the changing consumer, a consumer who won’t be satisfied with anything less than a memoir from every animal that contributes to the menu.

Well, there is no doubt that the food market is changing, and that agricultural production will have to change to meet new demands. But there are all kinds of markets for all kinds of products. McDonald’s customers want fast, cheap, and tasty. They don’t have the budget or the time for anything else. There is nothing wrong with satisfying that market niche, and McDonald’s should know who they are rather than chasing the latest nostrum from Dr. Oz.

When our three kids were small and every extra dollar was invested in our business, McDonald’s provided a place where we could feed the thundering herd in a hurry, and where we wouldn’t be asked to leave because the kids were organizing a good-natured riot. Now that the kids are gone and the wallet fatter, those things aren’t quite as important. I stopped for a cup of coffee at McDonald’s after my time with the Director of All Things Trendy. The bathroom was filthy and 14 people were in line. I left.

Oh, and I think “Head Buyer” or “Director of Purchasing” is quite enough title for the guy in charge of ground beef and hamburger buns.

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  1. Joseph Kulisics Inactive
    Joseph Kulisics
    @JosephKulisics

    In my last post, what I was trying to say is that the current decline of McDonald’s seems to be following a predictable course.

    1. By innovation, a company revolutionizes a market serving low and middle-income Americans. (McDonald’s revolutionized fast food by automation and its speedy service system, and Walmart revolutionized discount retail distribution.)
    2. The company becomes so successful as to be synonymous with the particular market.
    3. In a move like Alinsky personalizing, progressives, who hate markets, attack the company as a symbol of its particular market and markets in general and their evils.
    4. The media pickup the attack and create the perception that the company has an image problem.
    5. The company hires critics or works with critics to reform its image and halt its supposed decline.
    6. In the process of changing according to the advice of the progressives, the company loses its core customers and its brand.

    If you want to predict if a company will come under attack, look at its foreign success. Ironically, McDonald’s is much better abroad right now. Except for the occasional chauvinist, people abroad actually like McDonald’s. Its global success makes it a symbol of American commercial hegemony and an necessary target for anti-American, anti-cosmopolitan progressives at home. There are few such successes, Coca-Cola, McDonald’s, Walmart, and most recently, Amazon and Uber. Right now, Apple and Google are progressive darlings, but if there are no other targets, look for progressives to turn on them, too.

    • #61
  2. V the K Member
    V the K
    @VtheK

    Thomas Stack:Carl’s Jr. is directing it’s marketing efforts towards its core demographic with its very untrendy menu and doing great. MacDonalds should take notice.

    Five Guys is also growing quite well. They offer a stripped-down menu of burgers, hot dogs, and fries. If you want something vegan, you can get a grilled cheese. They make their food well, if not necessarily fast. And they let you open carry if you are in a jurisdiction that recognizes that right.

    • #62
  3. Bob L Member
    Bob L
    @

    V the K:

    :Carl’s Jr. is directing it’s marketing efforts towards its core demographic with its very untrendy menu and doing great. MacDonalds should take notice.

    Five Guys is also growing quite well. They offer a stripped-down menu of burgers, hot dogs, and fries. If you want something vegan, you can get a grilled cheese. They make their food well, if not necessarily fast. And they let you open carry if you are in a jurisdiction that recognizes that right.

    I’m with you on this.  I hate vegans so much, the only option I’ll give them is non-vegan.

    Fun fact:  Buffalo Wild Wings uses fryer oil that includes beef fat.  A few years ago, I let an annoying friend of a friend (who happened to be a lefty vegan) get halfway through her fried pickles before bringing this up.

    • #63
  4. Z in MT Member
    Z in MT
    @ZinMT

    McD’s has a stake in Chipotle and they are jealous of Chipotle’s success, so they are trying to turn into the Chipotle of burgers. A niche already being filled by Five Guys and Shake Shack. I agree that it is not going to work.

    Sounds like McD’s needs to exert more control over franchisees to make sure that their service and cleanliness standards are met.

    • #64
  5. dnewlander Coolidge
    dnewlander
    @dnewlander

    Z in MT: McD’s has a stake in Chipotle and they are jealous of Chipotle’s success, so they are trying to turn into the Chipotle of burgers.

    Not any more:

    http://www.businessinsider.com/the-ridiculous-reason-mcdonalds-sold-chipotle-2015-5

    The claim is that Chipotle was distracting them. I agree with other posters here that it’s more that they’re embarrassed of themselves and so have “reinvented” themselves completely out of what made them successful.

    BTW, a friend’s mother grew up in San Bernardino and was in high school when Ray Kroc came to town to find out exactly who needed *eight* four-mixer milkshake machines.

    When he died, Kroc’s greatest regret was allowing McDonald’s restaurants to have dining rooms. :)

    • #65
  6. Man O Tea Member
    Man O Tea
    @ManOTea

    V the K:

    :Carl’s Jr. is directing it’s marketing efforts towards its core demographic with its very untrendy menu and doing great. MacDonalds should take notice.

    Five Guys is also growing quite well. They offer a stripped-down menu of burgers, hot dogs, and fries. If you want something vegan, you can get a grilled cheese. They make their food well, if not necessarily fast. And they let you open carry if you are in a jurisdiction that recognizes that right.

    Ha! Love the open carry addendum. I’m going to find a Five Guys right now!

    • #66
  7. Matt Balzer Member
    Matt Balzer
    @MattBalzer

    Man O Tea:

    V the K:

    :Carl’s Jr. is directing it’s marketing efforts towards its core demographic with its very untrendy menu and doing great. MacDonalds should take notice.

    Five Guys is also growing quite well. They offer a stripped-down menu of burgers, hot dogs, and fries. If you want something vegan, you can get a grilled cheese. They make their food well, if not necessarily fast. And they let you open carry if you are in a jurisdiction that recognizes that right.

    Ha! Love the open carry addendum. I’m going to find a Five Guys right now!

    Okay, that’s a plus. I’ve been to Five Guys once, and perhaps I did it wrong, but it seems overrated to me. Decent, but not as great as everyone claims.

    • #67
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